DEED gives presentation on economic development programs
On Feb. 27, the House Jobs and Economic Development Finance and Policy Committee heard reports from the Department of Employment and Economic Development (DEED) on the Minnesota Investment Fund, the Job Creation Fund and the Angel Investment Credit. The explanation of the programs was very thorough, and some of the statements and statistics were rather surprising.
When it comes to the Minnesota Investment Fund (MIF), which provides financing to help add new workers and retain high-quality jobs on a statewide basis, DEED says 82 percent of that money is spent in Greater Minnesota. Overall, MIF generates a 33-to-1 return on the investment. So far in fiscal year 2015, which started July 1, $5.2 million of the $30 million designated for the fund has been distributed.
The Job Creation Fund is the newest of DEED’s programs, and it is fair to say they see it as their crown jewel. The fund provides financial incentives to new and expanding businesses that meet certain job creation and capital investment targets. Companies deemed eligible to participate may receive up to $1 million for creating or retaining high-paying jobs and for constructing or renovating facilities or making other property improvements. In some cases, companies may receive awards of up to $2 million. So far, this fund has received six applications, with four coming from Greater Minnesota.
The final program DEED presented was the Angel Investment Tax Credit. Commissioner Katie Clark Sieben was upfront about the geographic limitations of the program, calling it effective but acknowledging that the majority of the businesses that have received the tax credit are in the Twin Cities. Committee Chairman Tim Mahoney (D-St. Paul) went even further, saying he was an “architect of this program” and decrying the lack of geographical balance. He said that if the program cannot meet the charge of being a statewide system, then the state should abolish it.
Click here for the Power Power from DEED’s presentation.